Revenue targets tax-avoiding benefits in kind

HM Revenue & Customs (HMRC) is to target employers in service sectors offering staff benefits in kind which avoid taxation.

Peter Davies, consultant at business advisory firm Vantis, warned that hospitality companies in particular could be committing offences unwittingly, by offering benefits such as staff uniforms, late-night taxi fares and food and drink.

“Often what HMRC and employers classify as benefits in kind is very disparate,” he said. “We have been expecting this for some time and would advise companies to review their current set-up.”

Fines will be levied per employee and could be considerable, Davies warned.

“The hospitality industry has been a target for some time,” he said. “This is another step in the revenue’s attempts to bring the industry into line and one that we feel will be quite successful.”